Out-Law Guide | 14 Mar 2013 | 10:39 am | 4 min. read
The Construction Industry Council (CIC)'s Protocol on building information modelling (BIM) makes some changes to how intellectual property created by companies working on a project is treated and how that intellectual property and any third party material is licensed.
The Protocol makes it easier for companies to obtain the rights to use material in certain circumstances and makes it harder for businesses to retain absolute control of their IP rights. Companies can take some simple steps to protect themselves against licensing problems.
The CIC's BIM Protocol was designed to make it easier for construction firms to use building information modelling (BIM). BIM is the use of digital modelling to improve the design, construction and operation of the built environment to enable the client and supply chain to realise a range of benefits such as the predictability of costs and programme management during construction and thermal efficiency projections during post-occupancy. For more detail see our Out-Law guide to BIM and our Out-Law guide to the CIC's BIM Protocol.
When individuals create material that will form part of a BIM system they generate intellectual property which is protected by law. Their employer generally has the use of this IP but companies working on a project and contributing intellectual property will have an interest in retaining a reasonable degree of control over it.
When material that has been created by third parties is necessary to a BIM system then companies will need to ensure that they have the IP rights to use that material, making IP a vital element in the use of BIM.
The Protocol is intended to be incorporated as a contract document and explicitly varies and supersedes any conflicting IP provisions in an existing contract as they relate to BIM models and materials.
The Protocol covers models and materials that are digital representations or on electronic media. If any of this information exists purely on paper or in physical models then it will not be covered by the Protocol. Companies should make sure that the main contract contains suitable protections regarding the disclosure and use of such hard copy materials and models so that this is not overlooked and at risk of becoming a subject of dispute.
Under the Protocol companies have an absolute obligation to licence or sub-licence any material that they are using which is owned by third parties. It says that that the 'Employer', meaning the organisation in charge of the building project, will 'represent' that it will procure those rights. Breach of a representation allows a contract to be rescinded, setting it aside.
This means that all companies working on a project must procure sub-licence rights from these third parties, allowing the employer to sub-sub-licence with confidence and avoid breaching its contractual obligations.
This is in contrast to the standard market position, which tends to be that companies working on a project only have to "use reasonable endeavours" to procure sub-licences for material owned by third parties. This recognises that it may not be within the power of a party to make a third party grant a licence.
Whilst it may be easier for a business to obtain third party consents when entering into new contracts by arguing that this is an absolute BIM Protocol requirement and thus non-negotiable, there may well be situations where third party content is already contained within pre-existing models and materials and where retrospective consent will need to be sought.
Businesses should carry out audits of
Companies which create IP will see their control of that eroded under the Protocol. When material is prepared for use on a project it is licensed to the employer on a royalty-free basis for the purposes of the project.
The employer can then sub-license this material to other companies, or team members, working on the project. Those team members can themselves sub-license it to others on the project.
Under standard contracts the degree to which this sub-licensing can happen is limited, generally to one or two defined levels. No such limit exists in the CIC BIM Protocol. This means that material created for a project can be disseminated very widely in a way that cannot be controlled by the creator. Some of that dissemination will be to rivals and competitors.
The Protocol limits dissemination to the purposes of the current project, but companies may not consider this protection to be good enough.
The Protocol creates a large incentive for companies working on a project to share IP, but does not give creators of IP absolute protection. The scope of the licence to be given is restricted only to use for project-related purposes, and there are restrictions against others modifying models and material - which will help guard against a recipient using disclosed IP as a basis to then 'create its own version'.
That protection ends when a team member's employment on a project has been terminated. This means that participants who were previously employed on a project but then had this relationship terminated for reasons where they were not wholly or partly at fault, such as force majeure or a dispute over payments or scope, will be at risk. Other project team members, who may well be competitors, will be allowed to access, use and modify their IP for the purposes of the project without any obligation to make payment.
These issues will create problems for some operators, but they will be likely to create problems equally across the industry.
Broadly speaking the BIM Protocol is a short and straightforward document with a clear and user-friendly mechanism for incorporation into Agreements. It does seek to be even-handed to participants and its cross-obligations, whilst these may be tricky to obtain, will be equally tricky for all to obtain and should hopefully lead to a consensus and accepted industry position, beneficial for all.